Flashback: Pelosi Claimed Jobless Benefits Were Economic Stimulus

Jan 11, 2013

RUSH: Here’s Rebecca, Palos Verdes, California. I have been there. Great, great place. How are you? Welcome to the program.

CALLER: Thank you very much, Rush. I believe that the flu outbreak should grow our economy. Because if you follow the liberal logic, if you’re unemployed, unproductive, sitting at home and getting unemployment and stimulus, that should grow our economy. Well, by the same token, if you’re sick — sitting at home, unproductive — and getting sick pay, that sick pay should be a stimulus to the economy.

RUSH: That is an excellent point. You are exactly right. Pelosi and other Democrats say that for every $1 of unemployment, $1.73 of economic output occurs.

CALLER: Yes!

RUSH: In other words, the $1 we pay somebody not to work creates $1.73 worth of work output. So your theory is, “Who cares if the flu wipes a bunch of people out and keeps ’em at home? That’ll make us even more productive! The same theory that works with unemployment benefits.”

CALLER: I think it may even cause a boom in America. Let’s all call in sick!

RUSH: It may! To heck with anybody working. Just put everybody on unemployment, and then get out of the way for all the economic growth that’s gonna happen. She’s right, folks. If you are relatively new to the program and you’re hearing our caller, I can understand you probably think, “What a nutcase! What a wacko!” No, she’s right. Nancy Pelosi and other Democrats have bragged about unemployment benefits growing the economy.

She’s said that they are worth it, that every $1 paid in unemployment benefits creates $1.73 in economic output. Sheila Jackson Lee has said it. Pelosi has said it. A number of ranking Democrats have said it. Of course it makes no sense. They’ve said it to justify the failure of their own economic policies. And they know that the database of low-information voters in this country will lap it all up and everything will be fine.

People have to buy medicine. You get the flu, you gotta buy medicine. That’s economic output! That’s economic growth. “Unemployment benefits are creating jobs faster than almost any other program.” This is what Pelosi said. I’m not kidding. I’m not making this up. “Unemployment benefits are creating jobs faster than almost any other program. It injects demand into the economy.” She said it.

Let me give you more from Nancy Pelosi. First, she did say, this is a quote. This is not a paraphrase. “Unemployment benefits are creating jobs faster than practically any other program. It injects demand into the economy.” Now, is it even worth our time to stop here and parse this? Unemployment benefits are what? Maybe for the low-information voter crowd we should do this. What are unemployment benefits? Unemployment benefits are checks you get when you don’t have a job. What is not happening when you don’t have a job? You’re not working.

So we can conclude, then, that unemployment benefits are paid to people who are not working. And when they’re not working, what are they doing? They’re watching television, or they’re reading TMZ, or they’re playing video games. Now, granted, they’re going out and buying stuff, Jack Daniels, Smirnoff Ice, chips, lottery tickets and so forth. So there is economic activity taking place. But again, now, for the low-information voter, where are the unemployment benefits coming from? That is money that is already in the economy. It’s not new money.

So if the unemployed, low-information voter is going out and buying some Smirnoff Ice and chips, it’s not Smirnoff Ice and chips that would otherwise not have been bought. If the unemployed were working, he’d still be buying the Smirnoff Ice and chips. So it’s a dead wash. At the same time, there is no economic productivity taking place on the part of the unemployment low-information voter. Low-information voter, unemployed, is not working. Therefore, he’s not accomplishing anything. There is no task being completed. And therefore economists call that economic output. There isn’t any.

And yet Pelosi is saying that unemployment benefits are creating jobs faster than practically any other program. Paying people not to work creates jobs. Nancy Pelosi. Not only that, paying people not to work creates jobs faster anything else we could do. Now, they’re not working, by definition. They can’t be working and getting unemployment checks. But Nancy Pelosi is telling us that unemployment checks create jobs and injects demand into the economy that wouldn’t otherwise be there, which none of those things are true.

Here’s more from Pelosi. Quote: “Let me say, unemployment insurance is one of the biggest stimuluses –” the correct word is stimuli, but she said stimuluses “– to our economy. Economists will tell you,” she said, “this money is spent quickly. It injects demand into the economy, and it’s job creating. It creates jobs faster than almost any other initiative you can name.” Well, then we should take everybody out of their offices and out of their shops and put them on unemployment if we really want to grow the economy. A ranking Democrat actually said this. It doesn’t matter if she believes it. The point is she said it, hoping to make Americans believe it.

Here’s more. “Unemployment insurance creates jobs faster than almost any other initiative you can name because, again, it is money that is needed for families to survive, and it is spent because it’s all they’ve got. So it has a double benefit. It helps those who’ve lost their jobs, but it also is a job creator.” Well, yeah, if you make chips or if you bottle Smirnoff Ice, but folks, this is what we’re up against, and the people who believe this stuff, who show up to vote, outnumber us. In a sane world, Pelosi would be institutionalized. She’d be wearing a white straitjacket, and there would be people really worried about her. Instead, she’s an oracle.

BREAK TRANSCRIPT

Now back to Pelosi. I said we have the sound bites of her quotes on unemployment insurance and all of the economic benefits that result from them. Here is what she said two years ago. It was July 1st in 2010. It was in Washington at a weekly press briefing that she held, and a reporter asked her a question. “Congress is gonna leave again with unemployment insurance not extended, Madam Leader. This is the second time y’all have recessed. What do you say to those poor people out there who are gonna be losing their benefits? How do you respond to the argument that maybe Congress shouldn’t be extending unemployment benefits because it’s a disincentive to people to look for work. Maybe you should stop giving these benefits away because as long as people get them they’re not gonna look for work. What do you say to that?”

PELOSI: Let me say about unemployment insurance, we talk about it as a safety net and the rest. This is one of the biggest stimuluses [sic] to our economy. Economists will tell you, this money is spent quickly. It injects demand into the economy and is job creating. It creates jobs faster than almost any other initiative you can name because, again, it is money that is needed for families to survive, and it is spent. So it has a double benefit. It helps those who’ve lost their jobs, but it also is a job creator.

RUSH: Now, look, as Hamilton Burger on the old Perry Mason show would say, “That’s incompetent, irrelevant, immaterial.” It’s also insane. Here you had the speaker of the House actually making the case that paying people not to work was an economic stimulus, and paying people not to work created jobs faster than anything else we could do. Paying people not to work creates jobs!

Well, then, let’s make everybody quit.

Let’s fire everybody.

Let’s put everybody on unemployment, then, and let’s test the theory.

It’s absurd!

This is why so many people concerned. Low-information voters eat that up, they lap it up, they believe it because they haven’t been taught anything differently in their education experience. Which takes me back to one of the big bugaboos I have, and that is the woeful ignorance in our country about the roots and the sources of prosperity. If people don’t know where prosperity comes from, then all the rest of it is academic and doesn’t matter.

If people think that prosperity comes from not working and receiving unemployment benefits, then we’re finished. If a majority of people who vote really believe that or can be swayed by that — that prosperity comes from government providing for people who can’t work — then we’re pretty close to over. In truth, prosperity comes — prosperity is created — by people doing useful things for each other.

In fact, you could say, if you wanted to make a really literal point, that prosperity doesn’t even have to deal with money. It could be accomplished with bartering. Money just makes the process more efficient. Via bartering. Okay, you don’t use money; you barter. It means you offer to change the tires on the butcher’s car and he gives you a steak. That’s barter. But instead of that, people pay each other for doing useful things for them.

People pay other people for performing useful things. People pay other people for inventing useful things. People pay other people for making useful things. People buy useful things because they want them. This is how prosperity is created. Therefore, what is required for prosperity? As many people as possible doing useful and desired things for each other. At its root level, this is so simple.

But economics is taught as this very complex, intricately woven web of deceitful, hard-to-understand things. But economic commerce happens when people engage in economic activity, i.e., you buy something that somebody’s made because you want it, and they sell it for profit. That’s their incentive to make it. If they’re only going to get back what it cost them, there won’t be any reason outside of passion (which doesn’t feed you) to make it. Simple as that.

As many people as possible working, producing and offering as many things and services as people need and want, equals prosperity. Therefore people sitting at home destroys it! People sitting at home doing nothing for anybody not only doesn’t create prosperity, it destroys it, and people like Nancy Pelosi… This is near criminally incompetent in basic economics. She says this…

Now, I don’t know whether she’s that dumb and really believes it or if this is simply the result of some strategic thinking and knowing their voters and knowing their audience and saying silly things to justify stupid government policy. It doesn’t really matter outside of the point of curiosity. But she said it; it couldn’t be more wrong. It is irresponsible for political leadership to be speaking this way, but she does.